On the heels of a 20% cut to AIC Limited’s workforce comes speculation of Fidelity Investments’ slashing its global staffing.
According to Ignites, a New York-based mutual fund newsletter, Fidelity is preparing to cut as many as 4,000 jobs in two rounds starting this quarter.
But according to Chris Pepper, director of media relations for Fidelity Canada, the rumours of layoffs are “speculative.”
“The reports of layoffs were focused on the U.S. operations of Fidelity. Fidelity Canada is independent,” explained Pepper. He adds that Fidelity Canada continues to achieve efficient operations, regardless of market conditions, and that there is little cause for concern as “both the retail and institution side [of Fidelity Canada] are experiencing long-term positive momentum.”
Despite rumours and speculation about what the U.S. operations are doing, there is no word on whether that would affect the roughly 750 employees of Fidelity Canada.
Pepper points out that the retail side of Fidelity Canada currently holds the number one position in net sales, as reported by the Investment Funds Institute of Canada, with total net sales of nearly $134 million ending September 30, 2008. “We also hold the number two spot in the year-to-date rankings, ending September 30,” said Pepper. On the institutional side, Fidelity Canada’s business is “growing quite well,” said Pepper, “at roughly 20% per year.”
According to media reports, the world’s largest mutual fund company’s U.S. operations has already reduced its workforce over the past year by 1,000 jobs in three rounds of cuts. None of these cuts were to the main money management business. Now, industry reports suggest Fidelity Investments will cut as many as 4,000 jobs, or about 9% of its 44,500-strong global workforce.
On Friday of last week, AIC Limited reportedly cut 20% of its staff, primarily from the marketing and technology divisions. No reason was given for the cuts, but AIC has had longstanding redemption problems as the company’s value-oriented investment style and heavy emphasis on financial stocks fell out of favour with investors and the market. To date, AIC has $4.6 billion in assets under management, a mere shadow of the more than $15 billion it managed during the early part of this decade.
Filed by Romana King Advisor.ca, Romana.king@advisor.rogers.com
(10/28/08)